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Fundraising Fundamentals, Section 13.2

HEFCE

What to Measure and What to Report

What you measure and report largely depends on the stage of your development office.

Start-up and early stage offices will probably place more emphasis on measuring activity levels; mature offices might put greater emphasis on income. At either stage, what you choose to report will also depend on whom you are reporting to, as different audiences may require different information.

Measuring Activity

You can measure activity in a number of ways:

  • How many prospects/alumni you are in touch with?
  • How often you are in touch with them?
  • How many ‘asks’ have you made?
  • How many repeat donors do you have?
  • How many new donors have been recruited?
  • How many one-off gifts have you received?

During the set-up and early stages, you can also look at progress against milestones such as:

  • Team development,
  • Database acquisition,
  • Annual fund launched,
  • Legacy programme launched and
  • Online giving in place.
Measuring Income

It is important when measuring income to decide what exactly you will measure. You need to define what your institution considers to be ‘philanthropic’ income. Do you include other forms of external funding, such as special government funds, research income derived from charities or industry and even investments made by the institution themselves in special projects?

Bear in mind that not all of this income may come via the development office. A good place to start is the Ross-CASE survey, where there is a standard set of rules for what to report in higher education fundraising.

There are two common measurements:

  • Income received and
  • Projected income (based on pledges, regular giving income and the anticipation of legacies or prospects).

Projected income is naturally less accurate than income already received. It should be treated with caution, especially when reporting to external audiences. You may want to discount projected income to reflect the likelihood that it will be received based on previous experience (e.g., represent pledged amounts at 90 percent of the anticipated income to reflect the strong likelihood that they will be received, discount regular gifts/prospects to 60 percent and discount speculative legacies or prospects at 10 percent).

Projected income and discounting are helpful as internal indicators for institutions to measure their current fundraising position or use when forward planning. However, projected income should never be widely reported or communicated to external audiences, as it can raise unsubstantiated expectations.

How to Report What You Are Measuring

It is risky to report monitoring figures without some explanation. Your audiences need to understand the implications of the numbers you are showing them.

For example, if your gift income in the reporting year is less than in the previous year, you need to explain this and point to its hidden value. The difference may be due to less cash income now but derived from a significantly increased number of individual donors who have subscribed to regular giving over several years. The figure represents steady income rather than a cash injection.

To Whom to Report

Internally, you will have some reporting obligations to your senior management. You may also have to present an annual report to your board of governors or trustees and may want to share stories of your success with other internal colleagues and stakeholders.

Externally, governing tax authorities typically require a formal account of your financial income. Some of your major donors, such as trusts, foundations and even corporations, will often require a report from the projects they support.

It is good to celebrate and share some level of success with all of your donors and prospects as well – to encourage future contributions and confidence in the institution.

When to Report

You will have multiple reporting deadlines throughout the year.

The majority of these deadlines will not have flexible dates (e.g., your institution’s board, major donors). Keep a calendar of these deadlines (note: most databases have a calendaring function) and plan ahead, since most reports require data from the development and finance offices, as well as stories of success.

If there is flexibility (most commonly with smaller individual donors and internal stakeholders), try to cluster those reports or communications (e.g., a quarterly email of success) to coincide with the non-flexible deadlines so that you are gathering data and information less frequently.


Action Items
  • During your start-up phase (and then each annual planning cycle), determine what activities and income you will measure and report.
  • Keep a reporting calendar, noting key audiences and donors that should receive reports, when each report is due and what the report should include.

You Might Also Want to Read:

Working with the finance office
Gift accounting and reporting
Setting achievable targets

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CASE provides numerous resources focused on assessment and benchmarking, including ROI information, as well as publications such as CASE Reporting Standards and Management Guidelines, which is available through the CASE online store.

Betheny Reid gives advice on how to take care of donors when launching scholarship programs.
Savant talks about ROI and benchmarking.
T.J. Rawlinson talks about the return on investment for annual giving.
Eric Thomas gives ways to assess how well a development office is doing.
Leisl Elder describes her institution's income streams and compares that model to those at other institutions.